A years-long saga over who has the right to the DAV property that has been called the top development site in Campbell County could soon come to a conclusion.
Maybe.
The Kentucky Court of Appeals last week reversed the Campbell County Circuit Court’s decision that the Board of Education was entitled to eminent domain to acquire the former Disabled American Veterans (known locally as the DAV) property located on U.S. 27 to use as a new middle school.
The court of appeals decision, which came on Dec. 16, said that the board’s right to eminent domain does not extend to public property, which is what the DAV building is considered.
Eminent domain is the right of a government or its agent to seize private property for public use, with payment of compensation.
It is noted that the school board did bid on the site before the city of Cold Spring did, but DAV rejected the school board’s bid, which was somewhere between $4 and $5 million. Therefore, the board decided to pursue eminent domain.
Cold Spring argued that the board of education could not claim eminent domain for public property; however, on Nov. 30, 2021, the Campbell County Circuit Court ruled that the board could condemn the property.
“The board had demonstrated a need for a new middle school and the need to condemn the disputed property specifically; that it had negotiated for the purchase of the property in good faith; that there was reasonable assurance that the school project would be completed; and that use of the property would promote economic development for the city,” the circuit court reasoned at the time.
On Dec. 7, 2021, the school took possession of the property and submitted $5.5 million to the courts, the recommended value.
On an appeal filed on March 4, the city argued that the circuit court made an error by concluding that the board could take its property through eminent domain proceedings because the General Assembly authorized the board to only take private property.
“The general rule is that a condemner to whom the power of eminent domain has been delegated may not condemn public property unless authority is expressly or impliedly granted by statute,” The appeal stated.
The appeal further reasoned that per (KRS 416.540(1), “to condemn” means to take private property, not public property, for public use under the right of eminent domain.
The appeal then addressed the board of education’s argument that the city purchased the DAV property as a “ruse” and challenged how it intended to use it. The appeal stated, “we are restricted by law to addressing only relevant matters, not peripheral or speculative issues.”
So what’s next?
Cold Spring City Attorney Brandon Voelker said the city will wait to see if the school board decides whether they want the supreme court to hear the case.
Campbell County Schools Superintendent Shelli Wilson said the school board had yet to decide on how they will proceed.
“The board will be discussing the ruling after the new year,” Wilson said.
Voelker said the city would love to sit down and discuss with the school board to find a suitable location for their school.
“The city extended the opportunity to meet to discuss cooperation and developing at least a site in the city that is similar in size and doesn’t adversely impact traffic,” Voelker said. “We hope they will reconsider the offer and consider meeting with the city.”
Cold Spring Mayor Angelo Penque echoed Voelker’s sentiment. He said in a statement that the city pledges to work with the school to secure a location for a new middle school.
Should the school board decide not to take the case to the supreme court and if they decide they no longer want the property, Voelker said the city would return their $5.5 million and turn the space into a healthcare facility.
Penque said the city remains committed to working with developers and prospective tenants of the DAV property.
“We were confident all along that the city was within its legal rights to own and ultimately develop the property with a project that will serve the entire Northern Kentucky population,” Penque said.
Voelker said that would only happen once the board decided not to appeal or the case was dismissed in the Campbell County Circuit Court.
Dan Ruh, President of Al. Neyer, the developer named by the city for the site, said in a statement that they felt through the process that the Campbell County Board of Education’s actions in taking the DAV property was an “inappropriate and illegal use” of Kentucky’s eminent domain statute.
“Al. Neyer still firmly believes in the tremendous possibilities at the DAV site – one the most desirable pieces of property in Greater Cincinnati and the top development site in Campbell County – and we plan to continue working closely with the City of Cold Spring as we explore opportunities to develop the site to its fullest potential,” Nuh said.
Here is a timeline of the previous reporting on this case:
Dec. 4, 2020: DAV announced it would sell its longtime location in Cold Spring at 3725 Alexandria Pike and build a new DAV facility in Erlanger at 860 Dolwick Drive. The city expressed interest in the property.
Dec. 14, 2020: Cold Spring announces plans for a healthcare facility to replace the DAV building. Mayor Penque said the city has been working to attract a major healthcare provider to the site and said the city had talked to developers for over a year. Penque did not divulge the provider but did say the developer was Al. Neyer.
At the same time, the Superintendent of Campbell County Schools (at the time), David Rust, put property acquisition on the school board’s meeting agenda that night for an executive session.
Dec. 16, 2020: The Campbell County School Board announced the decision made in their executive session that they would pursue the idea of taking the property through eminent domain.
Penque expressed dismay and questioned why the school board had not approached the city. Rust said they told the city in January 2020 that they were interested in the DAV property for a new middle school. This second middle school would serve the northern tier of the Campbell County School District population.
Dan Ruh, a representative for developer Al. Neyer said they had been working for almost a year to develop the healthcare facility project and have a binding agreement with the city.
At this point, the city and developer brought up issues with a school on that property, such as increased traffic and an extensive gas line that would be costly to remove and had to be removed. Ruh said he would happily sit down with the school board to find another suitable site.
Dec. 18, 2020: Cold Spring approves the purchase of the DAV property and plans Industrial Revenue Bonds and PILOT for school taxes.
Dec 31, 2020: The Cold Spring City Council votes to sue the Campbell County School District and/or KY Board of Education for interference with its purchase of the DAV property. Brandon Voelker sends a letter to the school board’s attorney Jason Reed, stating the reasoning behind the suit.
Jan. 13, 2021: Reed filed a suit against the city, stating that some of the city’s special meetings to discuss the DAV property in December 2020 did not follow the law concerning public input and advertising the meetings properly. The school board demanded any action taken during those meetings be rescinded by the city.
Voelker responded that the city had some glitches with Zoom and that they would switch to in-person-only meetings and announced a new meeting that would essentially discuss the same things the meetings in question had discussed.
The attorney general ruled that the city had violated the open meetings laws.
Jan. 28, 2021: Cold Spring proceeds to purchase the property from DAV. The city also offers to help the schools find an alternative site. The developer has a purchase agreement with the city so that the city would become the owner, and Al. Neyer becomes the developer.
The city also filed a complaint against the schools for intervening in the city’s purchase of the property. Reed said the school was not discussing the purchase of the property and that condemnation was not a purchase.
After some complaints that the schools also had not cleared their plans with the Kentucky Department of Education, Reed said they didn’t have to unless they moved ahead with the condemnation. He said whether the school district could condemn was up to the courts and was expected to be ruled on in 90-120 days.
Feb. 5, 2021: St. Elizabeth is identified as the facility interested in the site. The agreed-upon purchase price for the property by the city is $6.5 million.
A commission of three county residents was selected to determine the fair market price for the property, and they set it at $5.5 million for eminent domain purposes, as the school would have to compensate DAV if that went through.
Feb. 17, 2021: Campbell County Circuit Court Judge Daniel Zalla ruled that Cold Spring could purchase the DAV property. The court’s ruling established the city’s interest in the property and the right to intervene.
The school board filed a lis pendens (pending legal action) on the property to create a lien that requires the issue to be settled before the property could be sold.
Feb. 26, 2021: The city votes to file an appeal on its open meetings violations.
March 30, 2021: The city moves ahead to authorize the mayor to purchase the property.
May 14, 2021: The city decides not to appeal the open meeting’s decision and pays the fines.
Voelker files a complaint on Reed that says Reed has been using his work computer and resources in his role as a staff attorney for the Cabinet of Health and Family Services in his private practice work.
The Cabinet of Health and Family Services conducts an internal investigation.
July 2021: Campbell County Circuit Court Judge Julie Ward held a preliminary status hearing on the case, and a ruling was expected in October.
Oct. 1, 2021: Cold Spring purchases the property, and Penque announced that Children’s Hospital expressed interest. The Children’s Hospital denied this, and the mayor retracted his statement.
Nov. 5, 2021: The Kentucky Department of Education issues a ruling that it approved the Campbell County School District to pursue eminent domain but outlined a few things the schools needed to do first to satisfy the department. Still no ruling on the case.
Nov. 30, 2021: Ward ruled that the school board is justified in taking the property through eminent domain. It is noted that the school board bid on the site first, somewhere between $4 and $5 million, but DAV rejected their offer. The school board decided to pursue eminent domain.
Dec. 7, 2021: The school board takes possession of the property. The school submitted the recommended value of $5.5 million to the courts.
The city votes to file an appeal.
March 4, 2022: The city files the appeal.
Dec. 16, 2022: The Commonwealth of Kentucky Court of Appeals overrules Ward’s decision, stating that the city being a public entity, cannot be subject to eminent domain.